Shuster Concedes Defeat on ATC Reform; Next Extension Due Soon

March 2, 2018

Prospects for House consideration of legislation reauthorizing the Federal Aviation Administration (FAA) took an abrupt shift earlier this week when House Transportation and Infrastructure Committee chairman Bill Shuster (R-PA) announced on February 27 that his ambitious air traffic control reform legislation (H.R. 2997) would not be moving to the House floor in its current form. The bill as reported from the T&I Committee last year would spit up the Federal Aviation Administration and turn the provision of air traffic control (ATC) over to a private non-profit corporation, a la the “Canadian model.”

In a speech the following day to an assembly of state DOTs, Shuster said he had no regrets on pursuing the policy of ATC spinoff (“it’s the absolute right policy”) but said it was “members of my own party that stopped us from moving this forward.” The White House had promised that President Trump would help convince reluctant Republicans to support the measure, but it became apparent this week that the President would not do so, giving Shuster no choice but to change course.

Current tax and spending authority for the Airport and Airway Trust Fund, which funds most FAA activities, expires on March 31 and a new extension will be necessary, since neither the House nor Senate have passed a full FAA reauthorization bill yet and are not likely to be able to negotiate a full bill by the end of the month. (This will be the 5th extension since October 2015.)

The real deadline for Congress to vote on the next extension is Thursday, March 22, since Congress is scheduled to leave for the two-week Easter-Passover recess starting Friday March 23.

Duration of the next extension has not yet been decided, but the logical timeframe is the end of July, hoping to spur final action on a FAA reauthorization before the August recess and before midterm elections sap the energy out of the Capitol. Shuster said that he and Senate Commerce, Science and Transportation John Thune (R-SD) hope to have a final bill before the August recess, so end-of-July for the extension would logically follow from that.

Shuster’s statement said, in part:

Despite an unprecedented level of support for this legislation – from bipartisan lawmakers, industry, and conservative groups and labor groups alike – some of my own colleagues refused to support shrinking the federal government by 35,000 employees, cutting taxes, and stopping wasteful spending.

Although our air traffic control reform provisions did not reach the obvious level of support needed to pass Congress, I intend to work with Senator Thune and move forward with a reauthorization bill to provide long-term stability for the FAA.

(All hail CQ’s Jacob Fischler, who ran into Shuster in the Capitol and got him to say that the bill would not move, and who reported that fact about an hour before the T&I press office could send out its announcement.)

Since the Senate’s version of the FAA reauthorization bill (S. 1405) from Senate Commerce does not address ATC restructuring, the ATC reform issue is dead for the remainder of this Congress. (Shuster is retiring from the House at the end of 2018, so if the issue continues into the 116th Congress, he won’t be in Congress to promote it.)

Splitting up the FAA and sending ATC to a new fee-funded entity is far from a new idea. The basic plan was first proposed in 1976 (both in Congress and then by outgoing Transportation Secretary William Coleman), and again in 1987 (by Senators Ted Stevens (R-AK) and Dan Inouye (D-HI)), and then again in 1993 by President Clinton. Later, significant elements of the plan were proposed by Clinton again in 1999 and by George W. Bush in 2007. (A complete legislative history of all iterations of this idea can be found here.)

In February 2016, the T&I Committee approved a similar Shuster bill, but House Republican leaders were never able to get a vote count of at least 218 (a majority of the House) in advance, so the bill never went to the floor. Last year, the T&I Committee approved H.R. 2997 on June 27, and on two different occasions House leaders indicated that they were close to bringing the bill to the floor, but both times they were stymied by the stubborn whip count.

In the last ten days, the rumor mill had the bill going to the House floor in mid-March, and this time it was going to move even if 218 votes for ATC reform were not nailed down beforehand – it was going to be “put up or shut up” time in a big showdown on the House floor. The hope was that personal support from President Trump (reiterated in the FY19 budget request on February 12) would get undecided House members off the fence and voting for the legislation.

But something happened in the last two days – possibly the loss of White House support for the proposal – and that plan was abandoned, along with the House bill.

Looking forward, how will the House bill get to the floor? Since ATC reform is dead, the rest of H.R. 2997 (almost all of which has general bipartisan support) must go on. Precedent on this runs both ways. On occasion, when events have overtaken legislation reported from the T&I Committee, the panel has met to vote on an amendment ordering fundamental changes in the bill, which the House Rules Committee has then incorporated into the bill before sending it to the floor. On other occasions, the chairman has simply worked with the Rules Committee to fix the bill without the whole committee being formally consulted. (The ranking minority member has had varying degrees of consultation on this over the years.)

There is also a related and more immediate question – how does this affect the FY18 omnibus appropriations bill? From an institutional perspective, the House and Senate Appropriations Committees were the chief opponents within Congress of breaking up the FAA, since they would lose control of a user-fee-financed, independent ATC entity. The fact that Shuster has now conceded Big Issue #1 to the appropriators automatically gives him more leverage over other disputes with the appropriators during the remainder of this Congress. In particular, the Senate version of the fiscal 2018 Transportation-Housing appropriations bill (S. 1655) contains at least a dozen legislative provisions that invade Shuster’s committee’s territory. Foremost among them is section 119L of the Senate bill, which would allow originating airports (not hubs where one changes planes) to increase the passenger facility charge (PFC) charted by airports from $4.50 to $8.50 per person.

The Senate Appropriations Committee adopted the PFC increase provision in part as a push-back against Shuster’s committee (and against the airlines) for pushing ATC reform. (This is a political analysis only – there are some good, substantive arguments for a PFC increase, which don’t necessarily excuse doing it in an appropriations bill instead of an authorization bill.) Now that the inside-baseball political motivation for pushing a PFC increase is mostly gone, will the substantive and political-outside-baseball reasons be enough to get the PFC increase through?

From a practical point of view, the way that omnibus appropriation bill negotiations work is like this: the Appropriations subcommittee leaders work through as many disputes as they can, and then they kick any unsolved disputes upstairs to the full Appropriations Committee leaders. And sometimes there are disputes (particularly with authorizing committees) that can’t be solved at the full committee level, so those get kicked upstairs again to the party leadership level. Talks at the Ryan-Pelosi-McConnell-Schumer level have to consult authorizing committee leaders as well as Appropriations leaders. By giving up on his “big ask” of ATC reform before the FY18 omnibus appropriations talks reach the party leader stage, Shuster has strengthened his negotiating position on all of the other issues within T&I jurisdiction that might arise during the omnibus talks. And this does not just mean the PFC increase, but also the various kinds of infrastructure funding that are going to be added to the FY18 omnibus pursuant to the recently enacted budget agreement.

Major House-Senate Differences on FY 2018 Transportation Appropriations Within the Jurisdiction of Authorizing Committees
House Bill (H.R. 3353) Senate Bill (S. 1655)
FAA Airport PFC increase No Yes (sec. 119L)
FAA Allow Cuba-bound planes U.S. stops No Yes (sec. 119E)
FAA Order FAA to promote US aviation No Yes (sec. 119J)
FAA Ban voice cell phone calls on airliners No Yes (sec. 119K)
FHWA Rescind highway contract authority Yes (-$800 million) No
FHWA Redirect dead highway earmarks No Yes (sec. 125)
FHWA Let Amtrak use CMAQ money No Yes (sec. 126)
FHWA Reinstate Clearview road sign font Yes (sec. 125) Similar report language
FHWA Amend ISTEA toll credit authority No provision Yes (sec. 129)
FMCSA Rescind FMCSA contract authority No Yes (-$118 million)
FMCSA Logging devices on livestock trucks Restricts use (sec. 132) No provision
FMCSA Safety fitness determinations Wait for IG certification (sec. 133) No provision
FMCSA Preempt state trucking laws (F4A) Yes (sec. 134) No provision
FRA Ban funds for Calif. high-speed rail Yes (secs. 151 and 152) No provision
MARAD Move title XI loans to OST Bureau Yes No

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